The True Cost of Powering an Electric Car

byCarroll Lachnit, Features Editor

November 19th, 2013

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Focus on Low Kilowatt-Hours, Not Cost Per Gallon

What if a gallon of gasoline cost $2 in the middle of the night, was free at lunch and set you back $8 in the afternoon? Welcome to the world of electric cars. If you buy one, the cost of a fill-up will largely depend on when and where you recharge it, not to mention the rates your utility company offers.

In the U.S., the cost of electricity varies far more than the cost of gasoline, from a kilowatt-hour average of 8.6 cents in Washington state to 37 cents in Hawaii. (A kilowatt-hour [kWh] is the amount of electrical energy consumed when 1,000 watts are used for one hour.) Depending on the availability of public charging, you might be able to recharge your electric vehicle (EV) for free during a lunch stop at the mall. But if the EV is going to be filled up at home, your rate could be much higher than the national average of 12 cents that the EPA uses on its fuel economy label for EVs.

Because of the variety of utility rates in the U.S., a 2013 Nissan Leaf that's a bargain to drive at average electricity rates in Washington (approximately $25 for 1,000 miles) is pricey in Hawaii, where those 1,000 miles would cost about $107. A conventional car would have to be getting 140 mpg to make that trip for the same money in Washington, while in Hawaii, a 38.5-mpg gasoline vehicle would do the trick.

For consumers primarily interested in driving an EV to save money, it's critical to know actual electricity rates (and the current cost of gasoline, for comparison purposes) instead of relying on national averages.

To figure out the cost of fueling an EV, start with the electric car's energy consumption rate, which is expressed as kWh per 100 miles (kWh/100m). This figure is listed on the EPA's EV fuel economy label and the government's fueleconomy.gov Web site. The next figure is your home electricity rate, assuming that home is your primary charging site. Multiply the kWh/100m figure by the electric rate to get the cost per 100 miles.

For instance, the 2013 Leaf's kWh/100m figure is 29. If electricity is 12 cents per kWh — the national average — it would cost $3.48 to go 100 miles.

Another way to calculate cost is to use the number of kilowatt-hours it takes to recharge the EV's battery. If an EV requires 20 kWh to fully recharge and the rate is 12 cents per kWh, that's $2.40 to fill up the car. What does that equal in mpg? See that equation discussed here. Rather than worry about mpg, cost-conscious EV buyers should focus on how to get car-charging kWh at the lowest rates.

Rate Schedules
The cost of electricity is based on the rates set by utility companies, time of use and level of use. The more electricity you use, the more you pay for it. And consumers generally pay more per kWh for electricity that's used at peak hours. Unless EV buyers do some planning, they could find themselves paying rates much higher than the national average of 12 cents per kWh.

In California, for example, Southern California Edison (SCE) has four rate tiers for residential users, largely based on usage, and they range from 13 cents per kWh to 31 cents. The cost of electric-vehicle charging could easily fall into the most expensive tier, since the electric car is being added to a household's existing demands for powering such things as heating, cooling, lighting and entertainment systems.

The "Home and Electric Vehicle Plan" divides the day into three periods. Two daytime periods each have two tiers of pricing, based on usage, while the midnight-to-6 a.m. "super off-peak" period has a flat rate of 9 cents for kWh in the summer months and 10 cents per kWh in the winter. That's because the utility wants EV owners to do most of their charging after midnight, when power usage overall is very low. The peak rate during the day, which is when SCE is supplying power to its business customers, is 47 cents per kWh.

SCE's other plan is an EV-only plan that requires consumers to pay to have a second meter installed. It only measures electricity used to charge the EV. They'll then be billed at a separate rate from the rest of the home. The rates for this plan are discounted to 11 cents per kWh for charging that occurs off-peak — before noon and after 9 p.m. SCE says the time-of-use option can give customers more flexibility for EV charging at very low rates, but it also involves more initial setup cost and time.

Kjaer suggests that consumers who are serious about buying EVs should contact their local utility companies as early in the vehicle-shopping process as possible to get guidance in choosing the rate that's best for them. SCE has resources that are specific to its customers, but there's also good general information there on EV readiness.

Real-World Experience
New Jersey restaurant owner Tom Moloughney has been driving electric cars for more than four years. He started with a Mini E in BMW's first EV test program and graduated in a new test to a BMW ActiveE, which is an electric version of the 1 Series coupe. He intends to be among the first purchasers of the new BMW i3 when it hits the U.S. market in 2014.

Moloughney put more than 73,000 miles on the Mini E, and so far has logged nearly 60,000 miles in the two ActiveE cars he's had (his first was retired after a traffic accident). He has been fanatical about logging data about his driving experiences and writing about them on blogs devoted to the Mini E and the ActiveE.

Moloughney's ActiveE has an energy consumption rate of 33 kWh per 100 miles: less efficient than the Leaf's 29 kWh/100m. But the ActiveE also has 170 horsepower versus the Leaf's 107. Moloughney said that when he gets his BMW i3, the numbers will be even better. "It's expected to be rated at around 25-26 kilowatt-hours per 100 miles," he said.

Until he added a solar system at this home, Moloughney could choose between two electricity rates for his EV charging: 18 cents per kWh at home and a commercial rate of 15 cents at his restaurant in Montclair, New Jersey, where he installed a 220-volt charger. Now he pays next to nothing for the juice for his car when he charges at home.

But if he paid full price at the residential rate of 18 cents per kWh, "it would have cost me about $3,000 to drive the Active E the past 20 months and 57,000 miles," Moloughney says.

At the average New Jersey rate of about $3.75 a gallon, "a gas car would have to get 71 miles per gallon to be comparable in cost per mile," he says. "And at my work rate of 15 cents per kWh, the gas car would have to get 85 miles per gallon."

As a point of comparison, take the BMW 128i, which is the gasoline version of the ActiveE. The BMW 128i has a combined city-highway fuel consumption of 22 mpg. Moloughney says he'd have paid $9,750 for the gasoline to travel the same distance he covered in the all-electric ActiveE for $3,000.

The Saxtons installed separate electric meters for their EVs in July 2009 and have been tracking energy use since then. The Saxtons' Tesla is consuming at a rate of 33 kWh/100m. The RAV4 and the Nissan Leaf each average about 35 kWh/100m. The Saxtons pay 11 cents per kWh for their fill-ups.

But rather than describing their energy costs in terms of kWh per 100 miles, Saxton said he and his wife tell friends that their vehicles travel about 27 miles on a dollar's worth of electricity. Of course, that is a dollar's worth at 11 cents per kWh. If they were paying the 3.5 cents per kWh that some Washington residents pay, they'd be getting about 84 miles to the dollar. And if they were in Hawaii, where electricity is 37 cents per kWh, it would be a much more expensive drive.

As the EPA mileage sticker for EVs reminds us, your results may vary, depending not only on the efficiency of the EV you're driving but also where and when you're charging it.